By Hiran H.Senewiratne
The CSE strongly bounced back yesterday with the ending of the volatility in the market, surpassing the highest intra-day gain of 100 points. Investors believe that the IMF agreement would be signed before the end of the year due to positive developments, stock market analysts said.Accordingly, shares gained over 1.5 per cent in mid-day trade pushed by foreign buying in the market, “because foreign buying has triggered local buying as well, but it’s on very thin volumes on mixed investments, an analyst said.
In the previous session, the market saw over a Rs 1 billion foreign outflow, the worst in more than 1-year, as an offshore fund sold shares in top private lender Commercial Bank. But yesterday the turnover touched just below the Rs 1 billion market, which needs to improve with the bouncing back of the market, market analysts said.
Amid those developments both indices moved upwards. The All- Share Price Index went up by 96.4 points and S and P SL20 rose by 19.4 points. Turnover stood at Rs 862 million with a single crossing. The crossing was reported in Aitken Spence, which crossed 236,000 shares to the tune of Rs 31.1 million and its shares traded at Rs 132.
In the retail market, top seven companies that mainly contributed to the turnover were, Lanka IOC Rs 158 million (871,000 shares traded), ACL Cables Rs 55.2 million (721,000 shares traded), Lankem Development Rs 38.9 million (1.2 million shares traded), Browns Investments Rs 38.7 million (6.6 million shares traded), JKH Rs 36.3 million (262,000 shares traded), Agsta Rs 34.6 million (1.8 million shares traded) and Expolanka Holdings Rs 33.4 million (216,000 shares traded). During the day 36.2 million share volumes changed hands in 15000 transactions.
During the day mixed interest was observed in Lanka IOC, ACL Cables and Ex-pack Corrugated Cartons, while retail interest was noted in Browns Investments, SMB leasing and Agsta.
Analysts said the outflow was due to the country’s vulnerable banking sector outlook.The Capital Goods sector was the second highest contributor to the market turnover (due to JKH), while the sector index increased by 1.73 per cent. The share price of JKH gained Rs. 4.25 (3.14 per cent) to close at Rs. 139.75.
But overall the market has been on a falling trend as investors awaited cues on policies from the 2023 budget, which is scheduled to be presented next week amid panic- selling from time to time.Yesterday, the Central Bank- announced daily US dollar buying rate was Rs 360.96 and the selling rate Rs 371.75. The inflation rate is 73.70 per cent.
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